Before his appointment in 2009 as the Registrar-General, Corporate Affairs Commission (CAC), Alhaji Bello Mahmud was Director of Compliance Department. Prior to joining CAC several years ago, he had held several positions including member of the defunct Constituent Assembly, Chairman Nigerian Bar Association, Sokoto and Attorney General and Commissioner for Justice in Sokoto State.
As helmsman in an agency that has been rated the Best Parastatal in Service Delivery in Nigeria by SERVICOM, Barrister Bello talks to the Economic Confidential on recent development in CAC. Excerpts:
EC: What led to the establishment of Corporate Affairs Commission?
The determination of the Federal Government to reform the Law regulating the affairs of Companies and its administration in Nigeria, led to the promulgation of the Companies and Allied Matters Act (CAMA) No. 1 of 1990. Prior to the promulgation of the Act, Government had noted that the Companies Act of 1968 which was in force then took after the English law system without paying appropriate attention to the peculiar problems of the Nigerian economy. The Companies Act of 1968 regulated the activities of the then Companies Registry and the Registration of Business Names Act 1961 regulated the activities of the Business Name Registry both under the Federal Ministry of Trade. While the Land (Perpetual Succession Act regulated the Registration of Incorporated Trustees under the Federal Ministry of internal Affairs. The Federal Government in March 1987 directed the Nigerian Law Reform Commission to carryout a reform of the various business laws including the 1968 Companies Act. The Law Reform Commission after two years of deliberation, recommended an independent well funded and well staffed body to administer Companies regulations and related matters in the country. The recommendations of the Law Reform Commission led to the enactment of the Companies and Allied Matters Act and the subsequent establishment of the Corporate Affairs Commission.
EC: When did CAC start operation as a Commission and what are its mandates?
The Corporate Affairs Commission started operations on 14th of February, 1991. As an agency of government, it is charged with, amongst other responsibilities, the regulation and supervision of the formation, incorporation, registration and management of Companies, Business Names and Incorprated Trustees.
EC: What are the major targets of your Commission?
Some of our target is to provide all the Commission’s services electronically on-line to our customers via the web and ensure fast and efficient delivery of these services without the customer having to come to the Commission physically; to ensure timely filing of annual returns and other statutory filings by all registered companies, Business Names and Incorporated Trustees, to ensure compliance with provisions of CAMA; and to make the State Offices more functional and at par with the Head Office in all aspect of registration services.
EC: Since your assumption of office as the Registrar General, what are your strategies to achieve some of the targets?
On assumption of office in October, 2009, I came up with a four (4) Point Reform Agenda to further reposition the Commission to ensure the achievement of the afore-mentioned targets. In our effort for Enhanced ICT infrastructure/Resources, we have embarked on an upgrade of the Commission’s WAN from a VSAT-based network to a more reliable fibre based system. This will improve network availability and also enhance transaction speed. While a pilot scheme involving some state offices is being executed, in due course, links to all 32 state offices will also be fibre-based. We have also embarked on rapid document imaging and data capture of records of companies that have been registered before the commencement of the electronic registration in 2004. An upgraded version of the Commission’s registration software (Content Pinnacle) has also been developed and will soon be deployed. One of its main features is the e-payment portal which will enable customers to pay and get the commission’s services electronically.
EC: How do you ensure easy access to your customers in all he states?
The Commission is taking practical steps to decentralize its operations to make the state offices more functional and at par with the head office. This will empower the state offices at strategic geographical locations in the country to print registration certificates. We have also constructed office buildings in 15 states of the Federation using our internally generated revenue. We intend to construct our own office buildings in the remaining States as our financial situation allows.
EC: What are the key positive developments in the operation of the Commission?
The commission’s processes have been fully automated. Registration of companies is being carried out using electronic workflows from name reservation up to certificate generation. The manual system of registration has been discarded. This has reduced the process time and eliminates mistakes hitherto prevalent in the manual system.
EC: Do you intend to strike off of dormant companies?
We do that. In fact the Commission had in accordance with the provisions of Section 525 CAMA struck off the names of 9,341 companies from the Register which was published in the Official Gazette No. 76 Volume 95, Government Notice 58 dated 23rd December, 2008. The Commission is in the process of stroking off another batch of about 50,000 companies.
EC: How do you address the complaints from your customers?
Customers can walk in, call us on phone or send us mails to feed us back or lodge complaints. Apart from that and in our desire to keep our customers abreast of the activities of the commission and obtain their feedback, management organizes customers forum on quarterly basis. The forum, which is interactive, brings together the Management of the Commission and representatives of key stakeholders i.e. Legal Practitioners, Chartered Accountants and Chartered Secretaries to interact on issues pertaining to the operations of the Commission. This serves as a feedback mechanism and help to foster a better understanding between the Commission and its accredited agents.
EC: In a nutshell can you give us the volume of registered companies in Nigeria?
As at 31st December 2011, the Commission has registered a total of 896,095 Companies, 1,917,670 Business Names and 47,421 Incorporated Trustees.
EC: What are your major challenges?
The Companies and Allied Matters Act after being in operation for almost 20 years require substantial amendments particularly in strengthening the Regulatory and Enforcement powers of the Commission and disclosure requirements by companies. We are working towards amending the law to address the observed lapses.
EC: How are you funded?
The Commission does not get subvention from the Federal Government. It relies solely on its internally generated revenue for all its activities. We also make contributions to the national economy. For instance in the past we have made payment of operating surplus to the Federation Account. In 2006 we provided N150 million, in 2007 we provided N826 million and in 2008 we provided N3 billion. We have continued to improve in our operation, service delivery and revenue generation for customers satisfaction and national economic development.
EC: It seems there are many businesses that are operating without registration with the Corporate Affairs Commission, what are you doing about them?
We have observed that in spite of the establishment of offices in all states of the Federation and other efforts made to ease the process of registration of businesses, some people still carry on businesses without registration. This has created opportunities for unscrupulous elements to use such unregistered businesses to defraud unsuspecting citizens. This is unacceptable and a trend contrary to the Companies and Allied Matters Act (CAMA). In order to stem this ugly practice, the Commission has made arrangements in its state offices to further simplify and ease the registration of companies. Public enlightment has also been intensified to educate people on the need to register.
EC: Are you taking any action to stem the tides?
The Commission will soon widen its enforcement activities by using the services of independent professionals to reach out to these unregistered businesses and get them registered. Our state offices have also intensified their enforcement drive through regular inspection visits to verify the status of businesses generating in their area of activities. In addition, the Commission is liaising with contract awarding bodies both in the public and private sector to further enforce the practice of confirming the status of companies before contracts are awarded.
EC: Are companies filing their annual returns as prescribed by law?
Every Company is required to file Annual Returns within 18 months after incorporation and subsequently every year. The increased awareness created by the Commission has helped to boost compliance as forms can be obtained from our offices or downloaded from our website.
EC: What are the other consequences for not filling the annual returns?
Such Companies shall be deemed to have ceased to exist as their names will be struck off from the Register. The Commission will also reject or turn down requests for due diligence from Banks and other regulatory bodies.
EC: Readers of the Economic Confidential will like to know your vision?
The Commission will continue to work hard to realize its objective of making the Commission a world-class companies Registry, providing excellent service, driven by the best technology and a highly motivated workforce. A Registry that keeps accurate and reliable companies records, with an effective enforcement capability that ensures substantial compliance by companies.